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Board of Italy's Carige approves no-confidence motion in CEO-source

Published 09/06/2017, 18:17
Updated 09/06/2017, 18:20
© Reuters.  Board of Italy's Carige approves no-confidence motion in CEO-source
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MILAN (Reuters) - The board of regional Italian lender Banca Carige (MI:CRGI) on Friday approved a no-confidence motion against Chief Executive Officer Guido Bastianini, a source close to the matter said, in a move that is likely to delay the bank's restructuring plan.

The board of the Genoa-based bank held the vote after its top investor, Vittorio Malacalza, said he no longer backed Bastianini, who had been in the job since April 2016.

Bastianini's departure is likely to create more uncertainty over the bank's future and add to pressure on Rome which is already negotiating a state bailout for larger rival Monte dei Paschi di Siena (MI:BMPS) and two Veneto-based lenders.

Loss-making Carige, heavily exposed to the northwestern Liguria region where it is based, has seen its bad debts swell during Italy's deep economic recession.

The European Central Bank has told Carige to strengthen its balance sheet and bolster a core capital that lags behind the ECB's minimum requirements.

Carige is working to shed bad debts and plans to raise 450 million euros (£395.8 million) this summer in its third cash call since 2014. That plan could be delayed given Bastianini's exit.

Malacalza, a local businessman who has a 17.6 percent stake in Carige, had also criticised the bank's chief financial officer. Carige shares have slumped more than 80 percent since Malacalza became the bank's top investor in 2015.

He had told the board he would step down as deputy chairman if his stance was not backed by a large majority of directors.

According to local media, Malacalza's no-confidence motion was backed by eight board members, while four voted against it.

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